If you’ve always left financial matters up to your spouse, the paperwork and responsibilities that come your way at the end of your marriage can be overwhelming. But overlooking certain things can have devastating consequences. Your car insurance policy is one of the things you don’t want to neglect.
Contrary to what you may think, your insurance company doesn’t actually insure your car. It insures the person driving the car…generally the primary driver. Unless you state otherwise, the insurance company will typically assume that the husband is the primary driver in a one-car family. If there are two cars, the insurance company will issue two policies. One car insurance policy will list the husband as the driver of one vehicle and the other policy will list the wife as the driver of the other. Each policy will provide allowances for the other spouse and any covered minors. This will also apply if there are three or more cars in a family: one primary driver per policy per car, with allowances for other designated drivers, contingent on how and where the car is commonly used. Why is this important to know? Because if your marriage breaks up and one partner moves to a new address, the insurance company’s main concern will be which car went with whom. Depending on the terms of your policy, this will apply to legal separations, too. You want to make certain that the car you’re driving lists you as the owner of the policy. This is critically important if you are awarded the only car in the family as part of the divorce.
In the single-car family, one of your first actions upon filing for divorce or legal separation should be to contact your car insurance provider and have the policy changed to your name and your address. Be aware that your ex-spouse’s written permission may be required if he or she was listed as the policy owner. In that case, consult with your attorney. Once you become the sole owner of your car insurance policy, you may be in for a couple more eye-openers. For example, your auto insurance premium may go up because you’ve lost the discount for insuring multiple vehicles. If you’re no longer coupling your car insurance policy with your homeowners’ insurance, that discount will disappear, too. If you’re the spouse who moved to a rental, even if it’s only a temporary solution, you should consider taking out renters insurance and seeing if you can qualify for a multiple policy discount on your car insurance in this way.
There could be some good news in store, however, if you move closer to your place of work. Check with your auto insurance policy provider to see if you qualify for a discount because of fewer commuting miles.